Hawes-Cooper Act

United States 1929

Synopsis

In the early 1900s, most prisons were involved in selling on the open market products made by inmates. The money earned from these sales was most often used to finance the prison itself. However, manufacturers, employers, and labor leaders in the open market argued that they could not compete with the prisons, which had a free labor force that could not strike. State governments could outlaw the sale of convict-made goods from their own state, but they had no control over the sale of prison-made goods imported from other states. The passage of the Hawes-Cooper Convict Labor Act in 1929 allowed states to remove the interstate commerce nature of prison-made goods and to prohibit the sale of such goods in their state, even if the goods were produced in another state.

Timeline

• 1914: On the Western Front, the first battles of the Marne and Ypres establish a line that will more or less hold for the next four years.
• 1919: Treaty of Versailles is signed by the Allies and Germany, but rejected by the U.S. Senate. This is due in part to rancor between President Woodrow Wilson and Republican Senate leaders, and in part to concerns over Wilson's plan to commit the United States to the newly established League of Nations and other international duties. Not until 1921 will Congress formally end U.S. participation in the war, but it will never agree to join the League.
• 1924: In the United States, Secretary of the Interior Albert B. Fall, along with oil company executives Harry Sinclair and Edward L. Doheny, is charged with conspiracy and bribery in making fraudulent leases of U.S. Navy oil reserves at Teapot Dome, Wyoming. The resulting Teapot Dome scandal clouds the administration of President Warren G. Harding.
• 1927: Charles A. Lindbergh makes the first successful solo nonstop flight across the Atlantic and becomes an international hero.
• 1929: The Lateran Treaty between the Catholic Church and Mussolini's regime establishes the Vatican City as an independent political entity.
• 1929: On "Black Friday" in October, prices on the U.S. stock market, which had been climbing wildly for several years, suddenly collapse. Thus begins the first phase of a world economic crisis and depression that will last until the beginning of World War II.
• 1929: Edwin Hubble proposes a model of an ever-expanding universe.
• 1931: Financial crisis widens in the United States and Europe, which reel from bank failures and climbing unemployment levels. In London, armies of the unemployed riot.
• 1933: Newly inaugurated U.S. president Franklin D. Roosevelt launches the first phase of his New Deal to put depression-era America back to work.
• 1935: Second phase of New Deal begins with the introduction of social security, farm assistance, and housing and tax reform.
• 1941: Japanese bombing of Pearl Harbor on 7 December brings the United States into the war against the Axis. Combined with the attack on the Soviet Union, which makes Stalin an unlikely ally of the Western democracies, the events of 1941 will ultimately turn the tide of the war.
• 1944: Creation of International Monetary Fund and World Bank at Bretton Woods Conference.

Event and Its Context

Passed on 19 January 1929, with an effective date of 1934, the Hawes-Cooper Act stated that all goods produced wholly or in part by convict labor "transported into any State or Territory of the United States and remaining therein for use, consumption, sale, or storage, shall upon arrival and delivery in such State or Territory be subject to the operation and effect of the laws of such State or Territory," thus allowing individual states to prohibit the sale of goods made by convicts on the open market whether those goods had been made within or outside of their state. The Hawes-Cooper Act was the product of cooperation between organized labor and business, and stemmed from the competition between the prisons and the free market.

Prisons used five different systems of labor: the lease system, contract system, piece-price system, public account system, and state use or state account system. In the lease system, prisoners were literally leased to another party who paid the prison for the use of the prisoners. A number of prisons supported themselves using the contract system, which took the revenue made by selling convict-manufactured goods to pay the prison's operating costs. The piece-price system was similar to the contract system, except the contractors provided the raw materials while the prisons provided the labor. The public account system was like the piece-price system, except the state provided the raw materials. Finally, in the state use or state account system, the goods produced were only sold to the manufacturing institution of other state institutions.

With each of these labor systems, the production and sale of convict-produced goods proved a serious competitor in the open market. Prison-made goods were cheaper to produce and sold for less. Prisons were in a unique position to cheaply and efficiently produce such items as brooms, brushes, shoes, iron moldings, and cigars. Besides the free labor, prisons also had low overhead. For instance, taxes paid for lighting, heating, and water whether the prisoners were working or sleeping. Free-market employers felt they had few options for competing with prison labor. Their choices included lowering the quality of work or abandoning the area of competition.

State governments could control the products made in their home state, but they had a harder time controlling the items brought in from other states. Before the passage of the Hawes-Cooper Act, individual states could not prevent the sale of convict-made goods from other states. Hawes-Cooper made convict-produced goods subject to the laws of the state in which the items were sold. Thus, if an individual state outlawed the sale of prison goods in their state, then the sale of prison-produced goods imported from neighboring states also would be prohibited. This feature made the Hawes-Cooper Act an enabling act: it let individual states decide whether to permit the sale of prison goods on the open market.

In 1932, two years before the Hawes-Cooper Act went into effect, a Department of Labor study found that of 158,947 convicts in 104 prisons, 82,276 (or 52 percent) were involved in some sort of manufacturing. The majority of the 104 prisons (42 percent) used the state-use labor system. About 38 percent of the goods, worth more than $28 million, were destined for the open market: 40 percent of these products were sold in the state where the goods were manufactured, while the remaining 60 percent were sent to markets out of the state where the goods were made.

Most of the convicts involved in making goods received no wages; for inmates who were paid, the wage was approximately 2 to 15 cents per day. The Department of Labor study also produced a list of the industries most affected by prison labor; the top prison industries included making shirts, pants, binding twine, chairs, and farm, garden, and dairy items. In the open market, businesses suffered not only because of the volume of items prisons produced but also because their specialization in making a particular item could threaten a regular business.

Most prison officials opposed the Hawes-Cooper Act. One of the most cited arguments against Hawes-Cooper was that its passage would leave prisoners idle. The American Prison Association stated that idleness destroyed the inmates' physical, mental, moral, and spiritual well-being. Others pointed out that some prisons used the proceeds from their manufacturing to support themselves, thus lessening the tax burden on citizens.

The enforcement of the Hawes-Cooper Act caused a financial crisis in a number of prisons. The cost of supervising and disciplining idle prisoners proved more expensive and many prisons lost a valuable source of income for the prisons' upkeep and staffing. In 1935 President Franklin D. Roosevelt created the Prison Industries Reorganizing Administration to foster state cooperation through a national program to give inmates meaningful work.

The constitutionality of the Hawes-Cooper Act was challenged in Whitfield v. Ohio (1936), but the U.S. Supreme Court upheld Hawes-Cooper by stating that free labor could not compete "with enforced and unpaid or underpaid convict labor." Other legislative acts followed Hawes-Cooper, including the Ashurst-Sumners Act (1935), Walsh-Healey Act (1936), Sumners-Ashurst Act (1940), and Comprehensive Crime Control Act (1984), which encouraged prison manufacturing to help control the cost of incarceration.

Key Players

Cooper, John Gordon (1872-1955): Cooper immigrated to the United States from England in 1880 and settled in Youngstown, Ohio. He attended public schools and worked in steel mills and for the Pennsylvania Railroad Company. A Republican, Cooper served as a member of the Ohio State House of Representatives from 1910 until 1912. In 1915 he was elected to Congress, where he served until 1937.

Hawes, Harry Bartow (1869-1947): Hawes was born in Kentucky and attended Washington University School of Law in St. Louis, Missouri. He represented Hawaii during its annexation and served as the president of the St. Louis police board from 1898 until 1904. Hawes also served as a state representative for Missouri (1916-1917). During World War I he served with the Military Intelligence Department of the General Staff and later was assigned to the U.S. embassy in Madrid. A Democrat, in 1921 he was elected to Congress and served until 1926, when he resigned to take a Senate seat. He served in the Senate until his retirement in 1933.

Bibliography

Books

Commons, John R., and John B. Andrews. Principles of Labor Legislation. New York: Augustus M. Kelley, 1967.

Convict Labor: Model Amendments to Solve Prison Labor Competition. Washington, DC: American Federation of Labor, 1930.

Hallett, Michael A. "Hawes-Cooper Act." In Encyclopedia of American Prisons, edited by Marilyn D. McShane and Frank P. Williams III. New York: Garland Publishing, 1996.

—Lisa A. Ennis